US:Power could hamper Japan recovery: IMF

Restoring power and government reconstruction spending are crucial to Japan's economy resuming growth, the IMF says, after Tokyo put the damage of the March 11 earthquake at $US309 billion.

International Monetary Fund officials said they expected a short-term slowdown, but growth would "rebound" to pre-quake levels and more.

But unlike natural disasters in other countries, the potential of sustained power shortages due to the Fukushima Daiichi plant emergency, the shutdowns of other nuclear plants and the radiation threat complicate recovery prospects, they said.

"The uncertainties from the nuclear situation and the power interruptions could weigh on the recovery by disrupting production across the country, and by weighing on corporate and household sentiment," said Ken Kang, the IMF's Asia Pacific division chief.

Kang cited Japanese government figures that 3 to 5 per cent of the country's capital stock was damaged or destroyed in the quake and subsequent tsunami, about double the scope of damage done by the 1995 Kobe earthquake.

"Despite the extensive damage we are of the view that the economic costs are manageable," he said.

Japan's government is fiscally strong enough to handle the recovery costs, and boosting spending to rebuild the country would have no long-term impact on its fiscal standing.

"We view Japan as having a relatively ample pool of savings that it can finance its own reconstruction needs," said Mahmoud Pradhan, the IMF Japan mission chief.